HIPAA 5010 Changes in Medical Billing

HIPAA 5010 Changes in Medical Billing

Nearly all Medicare Part B claim transactions are now submitted electronically. Physician offices and healthcare organizations should be prepared for the electronic data interchange (EDI) standards (version 5010), which replace the current 4010 standards for healthcare transactions. The Health Insurance Portability and Accountability Act (HIPAA) of 1996 mandated that members of the healthcare community change from standard billing formats to electronic claim transactions.

The Department of Health and Human Services (DHS) issued a ruling in 2009 to replace the current 4010 with the version 5010. Health plans, healthcare providers, and healthcare clearinghouses all must adopt these new standards for claims, eligibility, remittance advice, and status inquiry.

What 5010 Means for your Practice

HIPAA 5010 conversion means substantial changes to information on claims submitted. These changes must be made so that processing is not delayed. To prepare for the conversion to 5010, your personnel should work with your practice management software (PMS) vendor or billing company to avoid delays in reimbursement. Inquire about necessary changes for your software, and let the vendor assist you with updates. Together, the practice and the vendor can make a plan for implementing the 5010 changes into the system.

To be HIPAA 5010 complaint, all electronic claims should include a physical address. The PMS should meet this requirement, but if not, ask the vendor to help you with this change. Also, to help guide the vendor, the Centers for Medicare and Medicaid Services (CMS) has a checklist on its website that offers questions and answers about 5010. These include:

  • Can your current system accommodate both the transactions and the data collection for version 5010?
  • Will there be any charges for these upgrades?
  • Is any upgrades requires, and if so, when are they available?

5010 Conversion Tips

To ensure that your practice sustains an acceptable cash flow during the transition from 4010 to 5010, follow these tips:

  • Establish a line of credit – Arrange for additional funds through a lending institution to maintain the practice’s cash flow if reimbursement is delayed for an extended period of time.
  • Limit year-end expenditures – Increase your cash reserves so you will be ready to handle delays in reimbursement, should this occur.
  • Submit as many claims as possible before conversion – Try to submit all the claims you can before the conversion deadline. This will reduce payment delays.
  • Fix corrections to any system issues – Go ahead and fix any system issues now, prior to the transition period. This will establish procedures to deal with any corrections to the billing system or practice management system. Identify which staff members will be involved with system upgrades, and find out what process the vendor has in place for urgent needs and services.
  • Contact the PMS vendor for an upgrade compliance check before the deadline. Discuss the changes with the vendor and have them assist as much as possible.
  • Check with the electronic clearinghouse to make sure that testing was done to assure claims will go through without any problems.
  • Review and adjust any data collection that may affect submission of claims. Be sure to confirm with the payers that they are also implementing and testing 5010.


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